If total revenue does not change as a result of a rise in price,it follows that demand is
A) perfectly elastic.
B) perfectly inelastic.
C) unit elastic.
D) inelastic.
E) elastic.

Question

Quizplus · Accepted Answer

If total revenue remains constant despite a rise in price, it indicates that the percentage change in quantity demanded is equal to the percentage change in price. This is the definition of unit elasticity. Therefore, the correct answer is C) unit elastic.

If Total Revenue Does Not Change as a Result of a Rise